Tag: swiss bank account

Evading U.S. taxes by having a “Swiss Bank Account” is no longer as secretive as it used to be. Swiss banks who help taxpayers evade their U.S. tax obligations have big fines to face.

The Department of Justice has a Swiss Bank Program, which was announced on August 29 2013. This program provides a path for Swiss banks to resolve potential criminal liabilities in the United States.

In order for Swiss banks to be eligible to enter the program, they were required to advise the Department of Justice by December 31, 2013 that they believe they had committed tax-related criminal offenses relating to undeclared U.S. related accounts.

Any bank already under criminal investigations related to their Swiss-banking activities as well as all individuals were excluded from the program.

What do banks have to do?

Under the Swiss Bank Program, in order to be eligible for a non-prosecution agreement, banks must:

Completely disclose their cross-border activities;

On account-by-account basis, give complete detailed information for accounts in which U.S. taxpayers have direct or indirect interest;

Agree to close accounts of account-holders who fail to come into compliance with the U.S. reporting obligations;

Give detailed information as to other banks that transfer funds into secret accounts or that accepted funds when secret accounts were closed

Pay appropriate penalties.

In exchange for the non-prosecution agreements, banks agree to cooperate in any civil or criminal proceedings, show it has implemented controls to stop misconduct involving undeclared U.S. accounts and pay penalties. In return, they won’t be prosecuted for their tax-related offenses.

Three Swiss banks pay big.

Mercantil Bank (Schweiz) AG used a variety of means that not only could assist U.S. clients in concealing their accounts, but they did assist is in holding mail and code name or numbered account services. By doing so, they ensured documents reflecting the existence of the accounts could remain outside the United States and beyond the reach of the U.S. tax authorities and protected by Swiss banking secrecy laws. Mercantil Bank assisted clients in opening and maintaining bank accounts in the names of sham entities.

Mercantil will pay a penalty of $1.172 million for holding a total of 116 U.S. related accounts with a maximum aggregate value of over $59.8 million since August 1, 2008.

BCN provided traditional Swiss banking services which assisted U.S. taxpayers in evading their U.S. tax obligations and hid accounts at BCN from the Internal Revenue Service.

The Department of Justice announced that Mercantil Bank (Schweiz) AG, Banque Cantonale Neuchâteloise and Nidwaldner Kantonalbank have reached resolutions under the department’s Swiss Bank Program. Together, they will pay penalties of more than $3.1 million and must continue to cooperate with the Department of Justice.